If you can solve it in excel, please provide formula details, or provide math solution, thank you.

This Problem Counts 3 Points Let's say that Saint Andrews Chips considers a 4th option regarding the industrial grade bagging machine. Saint Andrews Chips engineers have determined that if the rm buys the machine (without the service contract) a method can be devised by their maintenance organization to preserve and actually enhance the capability of the machine over time. By reinvesting 25% of the annual cost savings back into new machine parts, the engineers can increase the cost savings at a 3% annual rate. For example, at the end of year one. 25% of the $25,000 cost savings ($6,250) is reinvested in the machine, resulting in $18,750 in savings. Next year, the cash flow from cost savings grows by 3% and so on. As long as the 25% reinvestment continues, the cash ows continue to grow at 3% in perpetuity. Determine the net present value of this option and select the answer that comes the closest to your solution